Schell Company manufactures automobile floor mats. It currently has two product lines, the Standard and the Deluxe.
Schell has a total of $26,040 in overhead. It currently uses a traditional cost system with overhead applied to the product on the basis of either labor hours or machine hours. Schell has compiled the following information about possible cost drivers and its two product lines:
Schell Company Total Quantity/Amount
Consumed by
Standard Floor Mat Line Quantity/Amount
Consumed by
Deluxe Floor Mat Line
1,170 labor hours 740 labor hours 430 labor hours
7,000 machine hours 2,900 machine hours 4,100 machine hours
Required :
1. Suppose Schell uses a traditional costing system with direct labor hours as the cost driver. Determine the amount of overhead assigned to each product line. (Round activity rates answers to 2 decimal places and final answers to 2 decimal places.)
Overhead Assigned of Standard Floor and Deluxe Floor
2. Suppose Schell uses a traditional costing system with machine hours as the cost driver. Determine the amount of overhead assigned to each product line. (Round activity rates to 4 decimal places and final answers to 2 decimal places.)
0verhead Assigned of Standard Floor and Deluxe Floor